CMA reviews package holiday refund policies

An investigation by Competition & Markets Authority (CMA) has widened into unfair refund policies to include package holidays.

Concerns over cancellation policies across the hospitality industry was said to be examined by the government body last month.

There was an increasing number of complaints as airlines and travel agents in some cases offered vouchers instead of cash refunds that consumers were entitled to.

From March 10th to May 17th, the CMA said it had been contacted more than 60,000 times about coronavirus-related issues and between May 11th-17th, on average 1,200 people a day contacted the organisation.

CMA said that holidays and airlines account for three-quarters of the total number of complaints about cancellations and refunds and consumer watchdog Which? welcomed the move.

Rory Boland, editor of Which? Travel, said that the CMA’s decision to include package holidays in the scope of its investigation into cancellations and refunds is a positive step, given the huge number of customers that are being left out of pocket by operators openly breaking the law on refunds.

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He went on saying that many holiday companies also continue to push refund credit notes onto customers, without making it clear when they are legally entitled to a cash refund and with no assurance from the government that these are financially protected, further adding to confusion from consumers around if and when they will ever see their money again.

The regulator must be ready to come down strongly against any package holiday provider unnecessarily delaying or denying refunds for cancelled holidays, to ensure that passengers have their money returned to them swiftly and trust in the industry is restored.